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Capital Gains Tax is NOT Income Tax #Leadersdebate

April 29, 2010

By Mark Littlewood

I am not going to tell anyone how to vote but this is interesting information about the effective rates of income tax and capital gains tax.

Remember that capital gains tax is paid when an entrepreneur sells a business.

To have done this, they have had to build something of value, something that has been paying employees who have paid tax and national insurance, corporation tax etc. For anyone to treat capital gains tax and income tax as the same thing is a liability to the economy and has no clue about what drives the economy forward.

If you are an entrepreneur, or care about private enterprise and the future of the economy of this country, this is an important distinction.

Tax and Capital Gains Tax Rates

This is the end of this non-party political broadcast.

To paraphrase my favourite physicist, Professor Brian Cox, ‘Anyone that thinks Capital Gains Tax is the same as Income Tax – is a Twat’.

In general though I totally agree that tax on small business is crazy. Right now I am working out how to spend/re-invest 1st year profits to avoid paying Corporation Tax. Small amounts mean a lot to a small business and I can much better put that money to work than giving to UK plc to inefficiently redistribute.

Please don’t confuse caring about “the future of the economy” with caring about how much you walk away with when you sell your business. If you prefer ow capital gains, that’s fine, but be honest and admin that it is purely out of self-interest.